Rationale of The Study

European Online Journal of Natural and Social Sciences 2016; www.european-science.
com
Vol.5, No.2 pp. 296-308
ISSN 1805-3602
How Knowledge and Financial Self-Efficacy Moderate the

Relationship between Money Attitudes and Personal Financial
Management Behavior
Muhammad Ali Jibran Qamar, Muhammad Asif Nadeem Khemta*, Hassan Jamil
COMSATS University, Lahore
*
E-mail: masifkhemta@yahoo.com
Received for publication: 04 January 2016.

Accepted for publication: 21 April 2016.
Abstract
This study finds the impact of money attitudes on the personal financial management
behavior and check the moderating effect of financial knowledge and financial self-efficacy on their
relationship. The sample for this research was young adults (University students) who were also
employed. From five universities where two universities were from the public sector and three were
from private sector 500 respondents were selected through purposive sampling. Hierarchal
Regression and factor analysis were employed to derive the results. The following are the results
which are generated from this research study. Money attitudes and Financial Knowledge have a
significant positive impact on the personal financial management behavior of young adults, and
financial knowledge has a positive moderating impact on the relationship of money attitudes &
personal financial management behavior. It was found that 20.9% Personal Financial Management
Behavior is explained by money attitudes at significance level of 5 %. Financial Self-efficacy has a
positive impact on the personal financial management behavior and it has positive moderating
impact on the relationship of money attitudes & personal financial management behavior.
Keywords: Financial Knowledge, Money Attitudes, Financial Self-Efficacy, Personal
Financial Management Behavior.
Introduction
Despite the understanding that money initially started as a medium of trade inside of the
marketplace, analysts have since a long time ago recommended that money is indeed a diverse
symbol endowed with importance and which means for every person. The psychology of money is
perhaps the least studied topics in the field (Furnham & Argyle, 1998). From the consumers’
perspective, however, the topic of money is important to individuals of all ages. For instance, studies
have demonstrated that even five year old kids are interested in the topic of money (Lau 1998).
Attitude has been defined as "a tendency to act in a good or unfavorable way toward an object"
(Eagly & Chaiken, 1993). Concerning money, Lown & Ju (1992), suggested that our attitudes and
emotions encompassing money are incorporated into our lives and, in this way, motivate behavior in
subtle ways. So we can conceptualize money attitude as one's perception about money. It is one's
attitude which outlines one's behavior in money matters.
Attitude we exhibit in money matters are numerous, it encompasses protection of social
position and individual satisfaction. People build an attitude towards money on the basis of
experience and circumstances that they experience over a lifetime. As such, money is perceived as a
commanding motivator of our conduct (Belk & Wallendorf, 1990). Gurney (1988) instituted the
expression "money self". Which affects behaviors, objectives, and responses to our lives.
Openly accessible at http://www.european-science.com 296

Social science section
The decision taken which are concerned with money, rely on money behavior which is the
result of the effects of one's money attitudes. Peoples’ attitudes towards money relies on different
variables such as for individual’s adolescence experiences, education, economic and societal status.
Depending on these variables, the attitudes towards money differ from person to person. People
develop their attitudes towards money from childhood. The people begin perceiving the attitudes
initially by observing parents, companions and peers and later by his perception of political, social
and financial environment overall. The money attitudes have an effect on consumers’ spending
habits, political philosophy, charitable giving, attitudes towards the environment, and work
performance, (Roberts et al, 1999).
Money attitude and behavior have been a common reason of concern among financial
experts, psychologists, academicians, strategy makers, sociologists and anthropologists for more
than three decades. Some research studies have recognized diverse aspects of money, demographic
variables that are connected with money attitudes, and frameworks based on psychometric theories
to explain financial behavior (Masuo, et al., 2004). Studies of financial issues uncovered that
attitude to money have a significant role in deciding a man's financial management and level of
financial well-being (Shim, et al., 2009). Evidence recommends that money attitudes precede
development of money behavior (Roberts & Jones, 2001), as such, money attitudes contributes to
predict financial practices (Dowling et al., 2009).
Money attitudes research has been affected most by Furnham (1984) and Yamauchi and
Templer (1982). The principal pragmatic research on money attitude measurement was done by
Goldberg & Lewis (1978), however it was Yamauchi & Templer (1982) who made the first
empirically accepted scale named as Money Attitude Scale (MAS). The present study concerns the
vital concept of money attitudes (MA), an attitude that focuses on money and its uses. Money
Attitudes exploration is giving new insights into customer financial behaviors, for example, saving,
debt, credit card use, and compulsive buying (Norvilitis et al. 2003).
Responsible financial behavior is strongly related with strong financial knowledge (Zakaria
et al 2012). Financial education has the best impact on financial management, which thusly
improved the apparent level of financial prosperity among students (Sabri& Falahati, 2012).
Providing families with financial knowledge and educating them on the need to practice good
financial behavior could prove valuable in approaching the problem of financial troubled families
(Zakaria et al 2012). The financial education positively impacts the financial management behavior
of non-whites regarding recording transactions and corresponding with financial institutions
(Haynes-Bordas et al 2008). The term financial literacy, financial knowledge, and financial
education frequently have been utilized interchangeably both as a part of the academic literature and
in the prominent media (Huston, 2010).
Individual financial efficacy was found to have a strong positive association with financial
well-being (Vosloo et al 2014). The hypothesis tested was "There is a relationship between financial
efficacy and financial well-being". The conclusions from this research were in favor of the
hypotheses.
Literature Review
Money Attitudes and Financial Management Behavior
Money beliefs and financial practices were studied and four different money beliefs patterns
were identified which incorporate money avoidance, money worship, and money status and money
vigilance (Brad klonzet al, 2011). Three of these beliefs were significantly associated with the
income and net worth. Four Money attitude scales were power prestige, retention time, distrust and
anxiety. The demographic components connected with the money beliefs were given. The literature
Muhammad Ali Jibran Qamar, Muhammad Asif Nadeem Khemta, Hassan Jamil
demonstrated that the financial matters are source of anxiety for the people and the families. Three
of these beliefs systems were significantly connected with income and net worth.
Gasiorowska (2015) investigated the effect of money attitudes on the relationship between
income and financial satisfaction. This research has demonstrated that the subjective perception of
objective wealth may be influenced by different individual distinction variables, for example, one's
love for money, level of desires, or materialistic slants. This study inspected an effect of attitudes
towards money on the connection between personal net income and family unit income, and its
subjective assessment, measured as financial satisfaction and subjective monetary prosperity.
Dowling et al (2009) studied the financial management practices and money attitudes as
determinants of financial problems and dissatisfaction. They analyzed the determinants of financial
issues and disappointment and the extent to which financial issues and disappointment impacted
attitudes towards financial counseling in a specimen of 400 young male Australian workers.
Monetary management practices and money attitudes altogether anticipated financial issues.
Monetary management behaviors, money attitudes, and financial issues additionally fundamentally
anticipated financial contentment. These results highlighted the requirement for financial education
initiatives for young workers to be coordinated at encouraging changes in financial management
behavior, money attitude and educational endeavors to expand the social adequacy of seeking expert
financial help for laborers with financial issues.
Influence of money attitudes on young Chinese consumers’ compulsive buying was
investigated by (Lu Wang et al., 2009) to examine how Chinese consumers' money attitudes impact
their compulsive purchasing conduct. Money attitudes were found to altogether influence Chinese
purchasers' compulsive purchasing conduct. In particular, the tetention-time measurement
influenced both male and female purchasers' compulsive purchasing whereas, the power-prestige
measurement just influenced male buyers' impulsive purchasing.
Klontz and Britt (2012) investigated the way clients’ money scripts predict their financial
behaviors. Among four indicators of money attitudes three indicators money avoidance, money
status, and money worship negatively affect financial health. These beliefs patterns are connected
with lower levels of total assets, lower earning, and higher measures of revolving credit. Money
script patterns can foresee disordered money practices, for example, financial infidelity, impulsive
purchasing, neurotic gambling, compulsive storing, financial reliance, and monetary empowering.
Money vigilance convictions, including subjects of frugality, caution, and anxiety about money,
appear to be protective elements against poor financial wellbeing and dangerous financial practices.
While they support saving and frugality, inordinate carefulness or tension could keep somebody
from enjoying the advantages and security cash can give. A person’s profession can foresee money
script patterns and vulnerability to disarranged money practices. In particular, when contrasted with
monetary advisers, psychological wellness experts will probably be money avoidant, business
experts are probably to be anxious and secretive around cash, and business experts, mental health
experts, and teachers will probably abstain from thinking of money, attempt to forgot about their
budgetary circumstance, and abstain from seeing their bank statements. Once distinguished, money
scripts can be tested and changed to interrupt the ruinous budgetary pattern and promote financial
well-being.
Financial Knowledge and Financial Management Behavior
Robb (2011) studied the financial knowledge and credit card behavior of college students.
The across the board accessibility of credit cards has raised worries over how college students may
utilize those cards given the negative results (both immediate and long-term) connected with credit
misuse and blunder. Results showed that financial knowledge is a critical element in the credit card

decisions of undergrads as individuals with higher financial knowledge are more likely to use credit
in a responsible way.
Changing College Students' Financial Knowledge, Attitudes, and Behavior through Seminar
Participation were investigated by Lynne M. Borden et al (2008) where they investigated the impact
of “Credit Wise Cats”, a financial education course exhibited by Students in Free Enterprise, on the
attitudes, knowledge, and aims toward financial obligation of undergrads. Results propose that the
course viably expanded undergrads financial knowledge, expanded responsible attitudes toward
credit and decreased avoidant attitudes towards credit from pre-test to post-test. Post-test sowed
students were more considering fundamentally successful financial practices and less risky financial
practices.
Joo & Grable (2004) studied determinants of financial satisfaction. Both direct, and indirect,
consequences on monetary contentment were recognized utilizing a path analysis. It was found that
monetary satisfaction is connected, both directly and indirectly, with differing elements, including
financial practices, financial anxiety level, income, financial knowledge, risk resilience, and
education. Effects of Financial Education and Impulsive Buying on Saving Behavior were
investigated among Korean College Students by Lee & Lown (2012). This research study analyzed
how monetary education, impulsive purchasing, and socio-demographic variables influence saving
conduct of 500 Korean undergrads. The results demonstrated that undergrads who got budgetary
education reported more positive saving conduct contrasted with undergrads who did not get money
related education.
Financial Self-Efficacy & Finance Management Behavior
Financial stress, self-efficacy, and financial help-seeking behavior of college students was
investigated by Lim et al, (2014) using Grable & Joo's (1999) framework. A psychological
methodology was taken by concentrating on the moderating role financial self-efficacy on the
relationship between financial anxiety and financial help-seeking. Results demonstrated that the
black individuals with education, have larger student loans, higher levels of financial stress, and
high monetary self-efficacy tend to look for help from experts. A moderating role financial self-
efficacy is watched, though its impact is weak. Danes & Haberman (2007) conducted a research on
5329 secondary school students to investigate the relationship between financial knowledge, self-
efficacy and behavior. Gender differences were researched in financial knowledge, self-efficacy, and
conduct after studying a financial planning curriculum. Females trusted that managing money
influenced their future more than males, however males felt more confident making money
decisions. In the wake of concentrating on the educational program content, males reported
accomplishing budgetary objectives more than females, while females reported utilizing budgets,
looking at costs, and talking about money with family more than males.
Factors related to financial stress among college students were studied in a research (Lim et
al, 2014). Worries that debt loads and other budgetary stresses negatively influence student
wellbeing are a top need for some university administrators. Factors identified with monetary
anxiety among understudies were investigated utilizing the Roy Adaptation Model, a theoretical
structure utilized as a part of health care applications. The outcomes demonstrated that understudies
with higher financial self-efficacy and more prominent financial optimism about what's to come are
essentially less inclined to report financial stress.
Individual financial efficacy was found to have a strong positive association with financial
well-being (Vosloo et al 2014). The hypothesis tested was "There is a relationship between financial
efficacy and financial well-being". The conclusions from this research were in favor of the
hypotheses. Postmus (2011) & Shim et al, (2009) found that financial literacy alone is insufficient to
guarantee control over individual finances; financial self-efficacy is similarly as important. Lapp's
(2010) found that higher financial self-efficacy is associated with less financial issues (i.e. more
control over individual finances).
Some researchers have indirectly concentrated on the relationship between financial efficacy
and financial well-being. Xiao et al, (2011) isolated perceived behavioral control into financial
efficacy and controllability. Perceived behavioral control (which includes financial efficacy) was
found to have a positive association with good financial practices (Xiao et al., 2011). Good financial
behavior, thusly, was found to have positive associations with financial contentment (Staten and
Johnson, 2010) and a repugnance for debt (Xiao et al., 2009). Accordingly, financial efficacy (as a
feature of general perceived behavioral control) was found to indirectly have a positive association
with financial satisfaction and financial prosperity.
Definitions & Measurement of Variables
Money Attitudes (MA)
Money Attitudes are one's Perception about money. These are people attitudes which portray
behavior in money matters. People builds up an attitude towards money on the premise of
circumstances and experiences that one goes through over lifetime for example, individual’s
childhood experiences, education, financial and societal position.
Money Avoidance
Individuals with this characteristic believe that money is bad, that rich individuals are greedy
and that they don't deserve money. Individuals may avoid spending money even for important
purchases. For the money avoider, money is regularly seen as a force that stirs up fear, nervousness,
or disgust. Individuals with money avoider scripts may be worried about manhandling credit cards
or over-drafting their financial records and they might undermine their financial achievement.
Money Worship
Individuals with this characteristic are convinced that more cash will solve majority of their
issues, that there will never be sufficient and that cash brings power and happiness. As indicated by
klontz et al (2008), "more cash will make things better" is the most well-known conviction among
Americans. People who subscribe to this thought believe that an increment in wage and/or financial
windfall would take care of their issues.
Money Status
People who trust that money is status see a clear distinction between socio-economic classes.
Status lovers believe that owning the most current and best things gives status.
Money Vigilance
For some individuals, money is a deep source of shame and mystery, whether one has a lot or
a little (Klontz and Klontz, 2009). Money Vigilance element appears to be connected to alertness,
readiness, watchfulness, and worry about money, and the feeling that one must be aware of pending
inconvenience or threat.
Financial Management Behavior (FMB)
Financial behavior is any human behavior that is relevant to money management. Common
financial behaviors include how people handle money, credit, and saving (Xiao, 2008; Xiao et al.,
2006). With the end goal of this study, financial behavior is characterized by the degree a student
borrows (i.e. students loans) saves or invests and spends. In this study financial management
behavior is taken as how students manage their finances.
Financial Knowledge (FK)
Financial knowledge is understanding key financial terms and ideas needed to function day
by day in society (Cathy Faulcon Bowen, 2002). The terms financial literacy, financial knowledge,
and financial education regularly have been used interchangeably both in academic literature and in
the prevalent media (Huston, 2010).
Financial Self-Efficacy (FSE)

Financial Self-Efficacy is, a man's perceived ability to control his/her own finances
(Postmus, 2011). Fox and Bartholomae (2008) characterized financial efficacy as "Knowledge and
capacity to impact and control one's financial matters". In this study, financial efficacy is interpreted
as a man's satisfaction in his/her level of knowledge and capacity to meet financial objectives.
Research Hypotheses
H1: Money Attitude has a significance influence on the personal financial management
behavior.
H2: There is significant moderating effect of financial knowledge on the relationship
between money attitudes and personal financial management behavior.
H3: There is significant moderating effect of financial self-efficacy on the relationship
between money attitudes and personal financial management behavior.
Methodology
Conceptual Framework
This study intends to explore the impact of money attitudes on the personal financial
management behavior and also moderates this relationship through financial knowledge and
financial self-efficacy in the presence of control variables as empirical researches has emphasized
for the inclusion of demographic factors. A positive relationship between age and saving has been
established by numerous studies (M. Searing et al, 1996). Family unit income or lifetime earnings
are positively connected with an increase in household savings (Rha et al, 2006). Perry & Morris
(2005) found that individuals with higher incomes are more likely to engage in responsible financial
management practices. Old individuals’ knowledge and experience, enable them to make better
investment decisions (Kumar & Korniotis, 2011).
Conceptual Model
Control Variables
Age Financial Self-
Efficacy
Gender
Income
Residential Area
Financial
Sociodemographic Management
Money Attitudes Behavior
Money Avoidance
Money Worship
Financial
Money Status Knowledge
Money Vigilance
Figure 1: Conceptual Framework

Questionnaire Design, Measurement and Pretest
The four measuring instrument categories used in this research were Money Attitudes,
Financial Knowledge, Financial Self-Efficacy and Financial Management Behavior.
The questionnaire for MA was a Five-point scale marked from “Strongly Disagree” to
“Strongly Agree”. The questionnaire for FMB was a Five-point scale marked from “Never” to
“Always”. The questionnaire for FK was a Five-point scale marked from “Nothing” to “A Lot”.

Table 1: Instrument for Data Collection

Variables Number of Items References
Financial Knowledge 6 (Perry & Morris, 2005)
Money Attitudes 24 (Klontz et al, 2008)
Financial Self-Efficacy 6 (Jean M. Lown, 2011)
Personal Financial Management Behavior 10 (Dew & Xiao, 2011)
The questionnaire for FSE was a Five-point scale marked from “Exactly True” to “Not at all
True”. Adopting the purposive sampling technique, 25 students of COMSATS University Lahore
were selected as a pre-test sample and the reliability of the questionnaire was tested.
Data Collection and Analysis Methods
The respondents were contacted in person by the researcher by going to each university and
questionnaire were be handed over to the voluntaries for getting good responses. SPSS was used to
perform statistical analysis. Descriptive statistics shown and determined how the data are
distributed. Regression Analysis was used to check the impact of independent variable (Money
Attitudes) on the dependent variable (personal financial management behavior). The moderation of
the variables financial knowledge and financial self-efficacy on the relationship of money attitudes
and personal financial management behavior was run through the Regression analysis.
Data Analysis
Sample Description
A total of 500 valid questionnaires were collected from the respondents. In this study the
percentage of female and male participated were 15.2 % and 84.6 % respectively which showed that
majority participated in this study were male. The descriptive statistics are given in table. 1.
Table 2: Descriptive Statistics
Descriptive Statistics
Gender Age Area Education Income
Male Female 25-28 28-31 31-34 > 34 Urban Rural Master M. Phill < 50 51-75 75-100 > 100
423 76 320 91 62 27 430 70 244 256 307 96 49 48
* Income in Thousands Rupees
Reliability and Validity Analysis
Reliability is basically the degree to which a research instrument produces consistent results
or reliability is the consistency of scores over time. Reliability Statistics provides the actual value
for Cronbach's alpha. Cronbach’s Alpha is generally used to measure the internal consistency of the
questionnaire. The value of Cronbach's alpha was 0.822 in pilot testing, which was higher than
required level which is 0.7 and showed a high level of internal consistency of scale.
Table 3: Means, Standard Deviations, Cronbach’s Alpha and Correlations
Means, Standards Deviations, Cronbach’s Alpha & Correlations
Variables Mean S.D Cronbach's Alpha MA FMB FK FSE
MA 3.33 0.33 .813 1.00 - - -
FMB 3.60 0.61 .845 .396 1.00 - -
FK 3.40 0.80 .844 .342 .292 1.00 -
FSE 3.23 0.79 .813 .443 .256 .440 1.00
* MA = Money Attitudes * FMB = Financial Management Behavior
* FK = Financial Knowledge * FSE = Financial Self-Efficacy

Validity is the extent to which a test measures what it is supposed to measure. To check the
validity of the scale factor analysis was used and convergent validity and construct validity were
measured by using factor loading manually. Factor loadings for the various question items range
between 0.451 and 0.830 and the explanatory variances of the various question items fell in the
range of 39.388 and 70.409. In addition, it is found that the eigenvalues for the various dimensions
are between 1.182 and 2.704, all larger than 1. Therefore, based on the results, the construct validity
of the questionnaire used in the present study is known. By using factor analysis the convergent
validity and construct validity of the questionnaire were checked. The results showed that the scale
is valid for the research.
Hypothesis Testing
1. There is significant influence of Money Attitudes on the Personal Financial Management
Behavior.
The impact of money attitudes (money avoidance, money worship, money status and money
vigilance), the results of regression analysis as indicated by Table 4, show a significance following
adjustments, △R2=0.209, F=14.14, R= .458 and p=0.000<0.05, these results shows that the
independent variable money attitudes demonstrated a 20.9% variance in explaining personal
financial behavior, indicating that money attitudes render some explanatory power. As the p-value
of independent variable money attitudes is less than significance level which is 5 % which shows
that money attitudes is a significance variable to predict personal finance behavior. As found from
the data in Table 4, hypothesis 1 is supported.
Table 4: Regression Analysis of Impact of Money Attitudes on Personal Financial Behavior
Dependent Variable Independent Variable Beta Value t Value P-Value
Personal Financial Money Attitudes 0.421 10.37 0.000
Management Behavior
R2= 0.209 △R2=0.209 R= .458 D-W=2.092 F=14.14 P = 0.000 N = 500
*P-Value < 0.05
The impact of money attitudes (money avoidance, money worship, money status and money
vigilance), the results of regression analysis as indicated by Table 5, show a significance following
adjustments, △R2=0.257, R=0.507, F=16.887 and p=0.000<0.05 for the variables money avoidance,
money worship and for money vigilance and p=0.162>0.05 for variable money status, as the p-value
of variables money avoidance, money worship and money vigilance is less than significance level 5
% it means these three variables have significance positive impact on the personal financial behavior
and the variable money status has p-value greater than 0.05 (5 %) so it has no significant impact on
the personal financial behavior.
Table 5: Regression Analysis of Impact of Money Attitudes on Personal Financial Behavior
Personal Financial Money Avoidance .226 5.210 .000
Management Behavior Money Worship .286 6.866 .000
Money Status -.061 -1.401 .162
Money Vigilance .212 5.044 .000
R2=0.257 △R2=0.026 R= .507 D-W=2.047 F=16.887 N = 500
* MA, MW, MV P-Value < 0.05, MS P-Value > 0.05
Further these results shows that the independent variable money attitudes (money avoidance,
money worship, money status and money vigilance) demonstrated a 25.7% variance in explaining

personal financial behavior, indicating that money attitudes render some explanatory power. As the
p-value of independent variables money avoidance, money worship and money vigilance is less than
significance level which is 5 % which shows that money attitudes is a significance variable to
predict personal finance behavior. As found from the data in Table 5, hypothesis 1 is supported.
2. There is significant moderating effect of financial knowledge on the relationship between
money attitudes and Personal Financial Management Behavior.
The moderating effect of financial knowledge in the influence of money attitudes on personal
financial behavior, the results of the regression analysis as indicated by Table 6, show a significance
following adjustments, △R2=0.241, F=11.773 and p=0.000<0.05, these results shows that financial
knowledge show a 24.1% variance in explaining the personal financial behavior making influenced
by money attitudes, indicating some explanatory power. The financial knowledge has a significant
positive impact on the personal financial behavior as the p-value is less than the significance level
which is 5%. As found from the data in Table 6, financial knowledge has a positive moderating
effect on the relationship of money attitudes and personal finance behavior. Therefore hypothesis 2
is supported and financial knowledge has positive moderating effect on the relationship of money
attitudes and personal finance behavior.
Table 6: Regression Analysis of Moderating Effect of Financial Knowledge on the Money
Attitudes & Personal Financial Behavior relationship.
Personal Financial Financial Knowledge Money Attitudes 0.083 1.982 0.048
Management Behavior
R2= 0.241 △R2=0.018 R= 0.491 D-W=2.037 F=11.773 P = 0.048 N = 500
*P-Value < 0.05
3. There is significant moderating effect of Financial Self-Efficacy on the relationship
between money attitudes and Personal Financial Behavior.
The moderating effect of financial self-efficacy in the influence of money attitudes on
personal financial behavior, the results of the regression analysis as indicated by Table 7, show a
significance following adjustments, R2=0.222, △R2=0.024, R=0.471, F=15.096 and p=0.000<0.05,
these results shows that financial self-efficacy show a 22.2% variance in explaining the personal
financial behavior making influenced by money attitudes, indicating some explanatory power. As
found from the data in Table 7, financial self-efficacy has a significant impact on the personal
finance behavior as the p-value of variable financial self-efficacy is less than the significance level
which is 5 %. From the table it is evident that as the p-value is less than the significance level so
there is positive moderating effect of financial self-efficacy on the relationship of money attitudes
and personal finance behavior. Therefore hypothesis 3 is supported and financial self-efficacy has
positive moderating effect on the relationship of money attitudes and personal finance behavior.
Table 7: Regression Analysis of Moderating Effect of Financial Self-Efficacy on Money
Attitudes & Personal Financial Behavior relationship.
Personal Financial Financial Self-Efficacy Money Attitudes .042 1.025 .036
Behavior
R2= 0.222 △R2=0.024 R= 0.471 D-W=2.109 F=15.096 P = 0.036 N = 500
*P-Value > 0.05

Results & Discussions

The Hierarchal regression results showed that overall model is significant and the money
attitudes have a significant positive impact on the personal financial management behavior. Further
financial knowledge and financial self-efficacy showed also a significant positive impact on the
financial management behavior. Following results were generated from hypotheses
Table 8: Decision of the Hypothesis
Hypothesis Independent Moderating Dependent Moderating Role Sig. Value Decision
No. Variable Variable Variable
1 MA - FMB - 0.000 Accepted
2 MA FK FMB Positive 0.048 Accepted
3 MA FSE FMB Positive 0.036 Accepted
* MA = Money Attitudes * FK = Financial Knowledge
* FMB = Financial Management Behavior * FSE = Financial Self-Efficacy
Financial management abilities and behavior for the university students have a critical
impact on their future life. The ability to handle money related assets is critical for each university
student. Financially knowledgeable students make good decisions for their families. Finance is the
main consideration in the alternative of whether to follow education or to do part time occupation.
Research Conclusions
The conclusions drawn from this study show that the money attitudes have a significant
positive impact on the personal financial management behavior. Financial knowledge & financial
self-efficacy have also positive impact on personal financial management behavior. Financial
knowledge has a positive moderating & financial self-efficacy has also positive moderating role on
the relationship of money attitudes and financial management behavior. This study provides a more
comprehensive research model. A large sample enhances the value of research. This study chose
young adults (university students) in Lahore as the target for empirical study. The large sample
covers a broad area to enhance the representation of the samples and highlight the value of the
research results. Money attitude has a significant impact on the personal financial behavior. This
study found that money attitude of money avoidance, money worship, money vigilance among
young people has a significant impact on their routine personal financial behavior, whereas money
status has no impact on the personal financial behavior.
Management Implications
Theoretical Implications:
This discovery helps us to recognize a different way of thinking about the relationship
between money attitude and personal financial behavior among young people. If one can figure out
which variables impact a man's financial management behavior and to what degree those variables
impact money related prosperity, helpful interventions can be intended to enhance individuals’
financial well-being. Financial organizers can evaluate customer money scripts as a piece of their
information gathering procedure to give a mutual language to investigate the effect of money
convictions on monetary practices and to anticipate potential dangers to customers' financial
wellbeing.
Practical Implications
Beliefs of the individuals about money which they make through experience, age, family
background and education have a significant impact on their daily financial behaviors like
purchasing, spending etc. This finding has well substantiated the importance of money attitudes and
personal financial behaviors among young adults, and for youth adults this study will help them to
understand the intricacies of budgeting finance and buying and spending behaviors with the goal
that future purchasing and spending choices can be made at the most intellectual level and to spend
their cash effectively. This study will help public sector create educational strategies to help
students, families and so on, to better arrangement and manage their budgets, to permit saving and
keep away from defaults.
Limitations of the Study
Although rigorousness and objectivity are striven for in implementing this study, there were
still some limitations in the research process that led to deficiencies in the research results. The
limitations of this study are enumerated as follows:
1. The first limitation is significance difference in the size of Young Working Adults
between the universities is a limitation of this study.
2. The second limitation of this research is that there can be other socio-demographic
variable which might have effect on financial management behavior.
Future Research Directions
Regarding the limitations of the data collected and analyses conducted, the following
suggestions have been proposed for those researchers interested in exploring related topics in the
future: (1) There can be possibilities that the other money attitudes scales can be used for the
measurement of the money attitudes and to check their impact on the financial management
behavior. (2) Continuing the inquiry into the issue of this study: there can be other variables that can
act as moderators on the relationship of money attitudes and personal financial behavior.
References
Ansong, A., & Gyensare, M. A. (2012). Determinants of university working-students’ financial
literacy at the University of Cape Coast, Ghana. International Journal of Business and
Management, 7(9), 126.
Borden, L. M., Lee, S.-A., Serido, J., & Collins, D. (2008). Changing college students’ financial
knowledge, attitudes, and behavior through seminar participation. Journal of Family and
Economic Issues, 29(1), 23-40.
Bowen, C. F. (2002). Financial knowledge of teens and their parents. Financial counseling and
planning, 13(2), 93-102.
Danes, S. M., & Haberman, H. (2007). Teen financial knowledge, self-efficacy, and behavior: A
gendered view. Journal of Financial Counseling and Planning, 18(2).
Dew, J., & Xiao, J. J. (2011). The financial management behavior scale: Development and
validation. Journal of Financial Counseling and Planning, 22(1), 43.
Dowling, N. A., Tim, C., & Hoiles, L. (2009). Financial management practices and money attitudes
as determinants of financial problems and dissatisfaction in young male Australian workers.
Journal of Financial Counseling and Planning, 20(2).
Duh, H. I. (2014). Application of the Human Capital Life-Course Theory to Understand Generation
Y South Africans’ Money Attitudes. Journal of Economics and Behavioral Studies, 6(12),
974.
Falahati, L., & Sabri, M. F. (2015). An Exploratory Study of Personal Financial Wellbeing
Determinants: Examining the Moderating Effect of Gender. Asian Social Science, 11(4),
p33.
Falahati, L., Sabri, M. F., & Paim, L. H. (2012). Assessment a model of Financial Satisfaction
Predictors: Examining the Mediate Effect of Financial Behavior and Financial Strain. World
Applied Sciences Journal, 20(2), 190-197.

Flores, C. (2014). First generation college student financial literacy: Impact of self-efficacy and
behavior.
Gasiorowska, A. (2015). The Impact of Money Attitudes on the Relationship Between Income and
Financial Satisfaction. Polish Psychological Bulletin, 46(2), 197-208.
Hafez, M. I. A. K., El Sahn, M. F., & Rahman, D. A. The Effect of Egyptians' Money Attitudes on
Compulsive Buying with the Role of Credit Card Use.
Hayes, J. V. (2006). Money attitudes, economic locus of control, and financial strain among college
students. Texas Tech University.
Haynes-Bordas, R., Kiss, D., & Yilmazer, T. (2008). Effectiveness of financial education on
financial management behavior and account usage: Evidence from a ‘second
chance’program. Journal of Family and Economic Issues, 29(3), 362-390.
Iqbal, K., Jan, F. A., Rehman, S. U., Khan, M. A., & Jalal, F. (2011). Evaluation of Financial
Management Know-How in University Level Students in Peshawar City. Journal of
Managerial Sciences, 5(2).
Klontz, B., Britt, S. L., Mentzer, J., & Klontz, T. (2011). Money beliefs and financial behaviors:
Development of the Klontz Money Script Inventory. Journal of Financial Therapy, 2(1), 1.
Lee, Y.-G., & Lown, J. M. (2012). Effects of Financial Education and Impulsive Buying on Saving
Behavior of Korean College Students. International Journal of Human Ecology, 13(1),
159-169.
Lim, H., Heckman, S. J., Montalto, C. P., & Letkiewicz, J. (2014). Financial Stress, Self-Efficacy,
and Financial Help-Seeking Behavior of College Students. Journal of Financial Counseling
and Planning, 25(2), 148-160.
Mandell, L. (2009). The impact of financial education in high school and college on financial
literacy and subsequent financial decision making. Paper presented at the American
Economic Association Meetings, San Francisco, CA.
Marsh, B. A. (2006). Examining the personal finance attitudes, behaviors, and knowledge levels of
first-year and senior students at Baptist universities in the state of Texas. Bowling Green
State University.
Maurer, T. W., & Lee, S.-A. (2011). Financial education with college students: Comparing peer-led
and traditional classroom instruction. Journal of Family and Economic Issues, 32(4),
680-689.
Norvilitis, J. M., Merwin, M. M., Osberg, T. M., Roehling, P. V., Young, P., & Kamas, M. M.
(2006). Personality factors, money attitudes, financial knowledge, and credit‐card debt in
college students1. Journal of Applied Social Psychology, 36(6), 1395-1413.
Perry, V. G., & Morris, M. D. (2005). Who is in control? The role of self‐perception, knowledge,
and income in explaining consumer financial behavior. Journal of Consumer Affairs, 39(2),
299-313.
Robb, C. A. (2011). Financial knowledge and credit card behavior of college students. Journal of
Family and Economic Issues, 32(4), 690-698.
Robb, C. A., & Sharpe, D. L. (2009). Effect of personal financial knowledge on college students’
credit card behavior. Journal of Financial Counseling and Planning, 20(1).
Sabri, M., & Falahati, L. (2012). Estimating a model of subjective financial well-being among
college students. International Journal of Humanities and Social Science, 2(18), 191-199.
Shim, S., Barber, B. L., Card, N. A., Xiao, J. J., & Serido, J. (2010). Financial socialization of first-
year college students: The roles of parents, work, and education. Journal of youth and
adolescence, 39(12), 1457-1470.
Selim, A., & AYDEMİR, S. D. (2014). A literature review on financial literacy.
Vosloo, W. (2014). The relationship between financial efficacy, satisfaction with remuneration and
personal financial well-being. North-West University.
Wilhelm, M. S., Varcoe, K., & Fridrich, A. H. (1993). Financial satisfaction and assessment of
financial progress: Importance of money attitudes. Financial counseling and planning, 4(1),
181-198.
Wang, A. (2009). Interplay of investors' financial knowledge and risk taking. The journal of
behavioral finance, 10(4), 204-213.
Woodyard, A., & Robb, C. (2012). Financial knowledge and the gender gap. Journal of Financial
Therapy, 3(1), 1.
Zakaria, R. H., Jaafar, N. I. M., & Marican, S. (2012). Financial Behavior and Financial Position: A
Structural Equation Modelling Approach. Middle-East Journal of Scientific Research,
12(10), 1396-1402.

Rationale of The Study

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Rationale of The Study

Uploaded by

Copyright:

Available Formats

European Online Journal of Natural and Social Sciences 2016; www.european-science.

How Knowledge and Financial Self-Efficacy Moderate the

Received for publication: 04 January 2016.

Openly accessible at http://www.european-science.com 296

Openly accessible at http://www.european-science.com 298

Financial Self-Efficacy (FSE)

Figure 1: Conceptual Framework

Openly accessible at http://www.european-science.com 301

Table 1: Instrument for Data Collection

Openly accessible at http://www.european-science.com 302

Openly accessible at http://www.european-science.com 303

Openly accessible at http://www.european-science.com 304

Results & Discussions

Openly accessible at http://www.european-science.com 306

Openly accessible at http://www.european-science.com 308

You might also like